Realistically speaking, people, including you, will perish in this world at some point. While it’s something that you don’t want to think about, you can put your mind at ease and protect your loved ones from further financial trouble if you get your estate or everything you own in order now. This is an important thing to do if you already know you’ll die soon. Fortunately, there are plenty of ways that can help you organize everything for your loved ones.
Here’s how you can prepare your estate for an upcoming passing:
Itemize Your Assets
To get started with the preparation, you should, first, itemize all your assets so you’ll know what to do next. For instance, you should go through inside and outside of your property to make a list of all valuable items. These can include your appliances, artworks and antiques, power tools, cars, and jewelry, among many others.
In addition to physical assets, you should also list down all your non-physical assets, such as bank accounts, insurance policies, individual retirement accounts (IRAs), brokerage accounts, 401(k) plans, and many more.
By making an inventory of all your assets, you’ll have a better idea on how to properly manage them after your inevitable demise. Also, be sure to gather all important documents in one safe place so it’ll be much easier for your loved ones to handle later on.
Draft A Will
One of the essential ways to prepare your estate for an upcoming death is to execute a will. It refers to a legal document that describes how you’d like your assets to go after your passing. This usually consists of provisions designating an executor of your estate, naming the beneficiaries of your estate, and many more.
Typically, drafting a will is a vital estate planning strategy because it makes sure that your loved ones will get everything you’ve worked for. Unless you have this legal document in place, all your assets will be distributed according to your state’s intestacy laws, which may not be favorable to your loved ones.
For example, if you’ve married for the second time, but have children from the first marriage, everything may be a bit complicated if you die without a will. Thus, if you’re in this kind of situation, consider writing a will or, better yet, talk to an experienced lawyer to educate yourself about what’s fair in a second marriage and estate planning. That way, you can have peace of mind, knowing that all your assets are prepared in the way you want it to be even after your demise.
Appoint A Responsible Estate Administrator
To successfully prepare your estate for your upcoming demise, you shouldn’t forget to select a responsible estate administrator who’ll be in-charge of managing your assets and ensuring that your wishes are executed accordingly. When appointing one for this task, be sure to consider an individual who’s in good mental state to make sound decisions for your estate and loved ones. While you can always choose your spouse to be the administrator, it’s best to look for other disinterested individuals to avoid emotions to affect their decision making ability.
Create A Living Trust
Apart from a will, a living trust can also be an effective estate planning strategy that can help ensure all your express wishes will be followed and your estate are properly distributed after your passing. When you establish a living trust, you, as the grantor or trustor, remains in control of the properties placed under the trust account throughout your lifetime. After your demise, your designated trustee will administer the properties for you according to your specific instructions.
Therefore, if you want to prepare your estate for an upcoming death, you should consider having a living trust to protect your loved ones’ financial interests once you’re gone. This is especially true if there are creditors who run after your properties for the satisfaction of your obligation. In such a case, you need to establish an irrevocable trust, which is known for being an asset protection tool.
Consult A Lawyer
Preparing your estate before you die involves some legalities. For example, when you write a will, you need to comply with some legal requirements to ensure the document is valid and binding. Unless you’re a legal professional, you need someone who knows how estate planning works.
Hence, if you require help in using some estate planning tools, reviewing these documents or even updating your list of beneficiaries, you should hire a reputable estate planning lawyer for assistance. This professional can provide you with valuable legal advice as to the best step to take when planning your estate.
If you’re already aware of your upcoming death, procrastination is something you shouldn’t do. While you may not want to think about dying, improper planning and preparation can result in a lot of trouble, such as family conflicts, assets distributed to the wrong person, payment of expensive estate taxes, and a lengthy court litigation. So, if you want to avoid these things, follow the tips mentioned above and you’re good.